TIDM63SQ
RNS Number : 2309O
Beyond Housing Ltd
29 September 2023
Appendix 2
Sustainable Bond Allocation and Impact Report 2022/23
Contents
1 Executive Summary 3
2 Bond Overview 4
3 Allocation Summary 4
4 Impact 4
5 Audit/Limited Assurance 6
6 Important Information 6
1. Executive Summary
1.1. Beyond Housing is a registered Community Benefits Society
(CBS), we have a group turnover of cGBP91.4m in 2022/23. We own and
manage c15,184 homes across nine local authorities in the
north-east, housing over c30,000 customers. Our staffing numbers
are c705 people, and we offer housing for rent and sale, including
shared ownership.
1.2. Our five-year strategy is based on four strategic objectives:
-- Provide quality services to our customers - increase customer
satisfaction, grow our independent living business, and have 65% of
our customers using digital services.
-- Build new homes and keep our existing home in good condition
- build circa 2,750 new homes, increase Tenant Satisfaction
measures (TSM) customer satisfaction with the quality of our homes
and repairs satisfaction and improve the Energy Performance
Certificate (EPC) ratings for all our homes to EPC C or better by
2030.
-- Invest in our communities/neighborhoods to create a great
place to live and work - offer the best information and advice to
customers, be a leading training provider and create neighborhoods
our customers are proud of.
-- A great place to work for our people - achieve Investors in
People (IIP) accreditation, deliver an agile working environment,
increase colleague satisfaction, and improve the health and
wellbeing of our staff.
1.3. In 2022/23 on the balance sheet, we invested GBP38.1m on housing property for letting,
GBP22.7m on completed shared ownership homes and GBP2.1m on new
shared ownership properties under construction. We completed 210
homes and, in spite of challenges within our operating area, made a
start on 48 homes working towards our overall program to meet
nearly 2,750 homes by 2030/31. Of the 210 homes delivered in year,
141 were for affordable rent, 17 shared ownership and 2 rent to buy
with 50 outright sales.
1.4. We continued the regeneration of the Church Lane, North
Estate in Eston in 2022/23 with a budget to invest circa GBP16m
into delivering the project to build c33 new homes, refurbish
existing homes, create street and garden layouts, achieve EPC C
targets and create green spaces.
1.5. We are committed to reducing our operating carbon footprint
through our direct and indirect emissions. This includes gas,
electricity, vehicles and travel. In our annual accounts we publish
our annual emissions that have fallen year on year.
2. Bond Overview
2.1. In May 2021 Beyond Housing issued its first sustainable
Environmental, Social & Governance (ESG) bond. The issuance, of
GBP250m notional value, had a day-1 size of
GBP165m, with net proceeds of GBP161.3m. In November 2022 GBP40m
of the retained bond was issued through a forward purchase
agreement with proceeds in November 2023. The retained portion,
totaling GBP45m, makes up the balance of the notional value.
2.2. Beyond Housing Bond details at 31 March 2023.
Notional Value GBP250million
Currency Pound Sterling
-------------------------------------
Maturity 2051 (30 years)
-------------------------------------
Format Secured, senior, bearer
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Repayment Bullet
-------------------------------------
Moody's Rating A2 retained (changed to unstable
2022)
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Coupon 2.125%
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Listing International Securities Market
(ICMA) of the London Stock Exchange
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3. Allocation Summary
3.1. The proceeds from the issuances have been allocated in line
with our Sustainable Bond Framework, including refinancing of
existing assets as well as a proportion allocated to new
developments. Assets refinanced by the proceeds of our Sustainable
Bond were identified according to the criteria in our Framework.
Refinancing accounted for 80% of net-proceeds of the initial
issuance.
3.2. Of the net bond proceeds of GBP161.3m, we continue to
allocate to existing housing stock and new homes added to further
our balance sheet in 2022/23.
4. Impact
4.1. In meeting our ESG targets we align many of our activities
to the ESG framework. Most of our properties c82% are Energy
Performance Certification (EPC) C or above and we plan for all
properties to be this by 2030. We install only energy A rated
boilers, and our annual capital works program includes insulation,
double glazing and kitchen, bathroom works ensuring 100% of our
homes meet decency standards every year. We follow
stringent gas and electric testing safety protocols to ensure
all properties are compliant. We survey our customer satisfaction
annually as well as colleagues and we have had no ombudsman
complaints. We ask all our larger contracts to outline their social
values and sustainability standards in tendering. We invest in our
communities recruiting c25- 30 apprentices annually and provide
neighborhood officers. We have waste disposal contracts with
suppliers to recycle many of our materials. We have regulatory
gradings from the Regulator Social Housing is G2/V1. Our Governance
grading changed in 2022 to G2 when we self-reported legacy housing
organisation incorrect rent matters, which are being resolved with
the RSH.
4.2 Some of our Housing Projects
We developed 30 new two-bedroom apartments at the Boho Village
development in Middlehaven. The apartments were delivered in
partnership with Middlesbrough Development Company Ltd (MDC) and
contractor, Equans. The purchase was supported by Homes England
with grant funding totaling GBP1.1m. All the apartments are
equipped with air source heat pumps, efficiently reducing carbon
emissions by extracting renewable heat from the environment to
generate hot water and heating in the home. This project supports
Middlesbrough Borough Council's commitment to restoring and
regenerating Middlehaven as the centre of thriving businesses and
homes that it once was. With the multi-million-pound investment,
the council 's ambitious Middlehaven Development Framework has
included bold ideas providing education, housing, retail and
leisure facilities.
A number of our customers will benefit from improved energy
efficiency, following the award of a grant from the Government's
Social Housing Decarbonisation Fund (SHDF). Beyond Housing joined a
consortium, led by the Tees Valley Combined Authority, in
submitting a successful bid to Wave 1 of the national scheme,
through which around 20,000 social housing homes which do not
currently reach the Energy Performance Certificate C rating will be
upgraded to increase thermal efficiency and reduce carbon
emissions. The GBP2.6 million SHDF grant award from the Department
for Business, Energy and Industrial Strategy, supported by
additional match funding of GBP2.25 million from partners,
including Beyond Housing, will help to deliver necessary
improvements to 231 homes across the Tees Valley region. A total of
60 homes, located across our communities in the Redcar and
Scarborough areas, will have energy-saving external wall insulation
fitted, ensuring they will be suitable for the installation of
clean heating systems in the future. Five properties, which
currently have inefficient electric heating systems in place, will
be fitted with new air source heat pumps straight away.
During the year we started selling the first homes are selling
at the final phase of our flagship Mill Meadows development in
Filey. Marketed under the trade name Viola Homes, the 112 homes in
the third phase of the 296-home site are all for open market sale.
This is a first for our organisation, as we delivered the earlier
phases of the development to include affordable properties for both
rent and shared ownership. The third phase will also deliver a
shop.
The homes in the final phase at Mill Meadows will be exclusively
marketed through Viola Homes, alongside our other new build homes
for open market sale, shared ownership and rent to buy across
Teesside and North Yorkshire. The recent launch of the show homes
at Mill Meadows marks the first major milestone for Viola Homes
since its launch in October 2021. The new, family-friendly homes at
Mill Meadows consist of two, three, four and five-bedroom houses
and bungalows, and will be built alongside new play areas, public
open space, highways and other infrastructure. The first homes
released for sale are reserved, with high customer interest in
further releases. Mill Meadows is situated in the coastal town of
Filey, in North Yorkshire between Scarborough and Bridlington. This
final phase of the GBP45million development will run for three
years, with handover of the final homes scheduled for February
2024.
5. Audit/Limited Assurance (BDO)
5.1 In line with investor requirements, the allocation and impact report has been
independently audited by BDO (Beyond Housing's external
auditors) and a report
provided to the board and M&G investments.
6. Important Information
6.1 This report:
-- Has been prepared by Beyond Housing for information purposes only
-- It does not form a legal investment, tax, accounting of other financial advice
-- Is intended to provide non-exhaustive, indicative and general
information it is not intended to be full comprehensive
-- Should be read in conjunction with the Annual Report and Accounts 2022/23.
6.2 This report has been prepared based on reviews and analysis
of our loan and data statistics. The report contains backward and
forward-looking information. Information has been provided by third
parties and the borrower. The information is relevant only on the
respective dates.
6.3 Beyond Housing makes no representation, warranty, assurance
of any kind, expressed or implied, or takes no responsibility or
liability as to the fairness, accuracy, reliability,
reasonableness, correctness or completeness of any opinions or
conclusions in the report.
6.4 The report offers no security or investment advice.
6.5 Beyond Housing is not liable for any loss, damage, liability
or expense incurred or suffered that is claimed to have resulted
from the use of this report by the recipients, including without
limitation and direct, indirect, special or consequential
damages.
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